Trading signals come in different varieties.
A trading signal is simply an alert that the trader can receive as to when they may want to enter or exit a trade. Trading signals are systems that should give the trader in the ability to enter, exit, and disseminate the information of a particular financial instrument in order to profit from trading it. While there are literally thousands of places to get trading signals from, the trader using these trading signals should be aware that there are different systems for different market environments.
Swing trading systems.
Some trading signals are based off of a swing trading system. These trading signals tend to last for a few days at a time, and are based off of the concept of selling at the highs and buying at the lows of the typical volatility of the financial instrument in question. By taking advantage of the fluctuations in the marketplace, this type of system can be quite profitable in a range bound and slowly trending environment.
Momentum trading systems.
Momentum trading systems are simply systems that base trades off of breakouts of recent consolidation areas. They also can be based upon major support resistance levels as well. Basically, when price goes above a resistance area, the system will signal the trader that they may want to buy a financial instrument as it seems to be breaking out.
In a nutshell, hedging systems tend to trade in opposite directions in order to smooth out some of the volatility that can be experienced in day-to-day movements of the markets. An example of a hedge trade might be to buy Microsoft while selling Adobe. The idea is that Microsoft might be a strong buy, but if the tech sector suffers some kind of setback, the profits gained from shorting Adobe should help soften the blow. It is a very complicated strategy and should not be attempted by amateurs. This is why most traders who are amateurs and choose to hedge will often use trading signals.
The scalping system is simply trying to capture small gains in a rapid fashion. Typical scalp trading the stock market might be something along the lines of trying to gain $.10 a share on your IBM trade. Trading signals that are based upon scalping systems will send the largest amount of signals, as is simply trying to capture such micro movements.
As you can see, not all these systems and produce the same kind of trading results. It is your job to recognize what kind of shape the market is in, and as to which one of these types of systems is most likely to produce positive results. Remember, the tool is only as good as the person using it.